The government and Auckland's mayor insist the latest initiative to boost home construction does not signal a return to urban sprawl in the city.

Phil Goff: "We have to go up, and we have to go out." Photo: RNZ / Diego Opatowski

Two government funding announcements yesterday, and a third a fortnight ago, will speed up the building of about 17,000 homes on Auckland's rural fringe.

A new agency, Crown Infrastructure Partners, will be given $300 million in each of the next two years to work with councils and the private sector to fund roading and pipes.

The first two projects to be considered for funding involve the Drury South subdivision proposed by Stevenson Group, which could get up to $68m, and roading around Wainui, near Silverdale, which could receive up to $149m.

Auckland mayor Phil Goff said the council had so far sought funding assistance only for those greenfield projects, and not to accelerate building within the existing urban area.

"It's possible for the future - but the focus that we've had is for the future urban land supply and the development of that - and that has been in the north and in the south.

"We know that we're growing at an unprecedented rate.

We have to have these houses and we have to go up, and we have to go out."

Mr Goff said help might be needed at a later date for inside the urban area.

"For example, we need a central interceptor pipeline to deal with the wastewater challenge on the isthmus, and that's another area that may [have] the potential for funding through a Special Purpose Vehicle," he said.

Mr Goff said the council was "absolutely not" ceding the role of shaping the city's future growth to the government.

"Everything that's being done here is within the new Auckland Unitary Plan [development blueprint] and consistent with it."

Mr Goff said it had been the council's choice to initially focus on getting future greenfield land up and running and so-called brownfields, or developments on existing urban land, may follow.

The government has been keener than Auckland Council in the past to loosen curbs on urban sprawl, but Finance Minister Steven Joyce said that was not what was happening with the funding announcements.

"We're actually keen to see all sorts of developments occur," Mr Joyce said.

"The Auckland Unitary Plan is allowing a whole lot of developments to occur in our established suburbs.

"We're also seeing very significant apartment builds, places like Albany, which is just over the hill from where I live, there's over a thousand apartments being built at the moment.

"And then of course we've got the greenfields stuff.

"My view is you've got to do all of them, otherwise you're not going to achieve the sorts of levels of house building that we need."

Mr Joyce hoped the Crown Infrastructure Partners model would encourage new investors, such as iwi, ACC or even the Super Fund, to help fund services such as water, wastewater and roading, although it's not yet clear how those investors would extract a profitable return.

The initial announcements have been in Auckland but the government has said the new joint-funding model is open to other councils.